An Educational Overview of Capital Gains Tax Mitigation
An interactive dashboard for exploring strategies for tax deferral and avoidance.
Important Information for Investors
This content is for educational and informational purposes only and does not constitute investment, tax, or legal advice. The strategies discussed are complex and may not be suitable for all investors. The scoring is for illustrative comparison and is not a guarantee of any outcome. Your specific financial situation, goals, and risk tolerance must be considered. We strongly recommend consulting with your qualified team of financial, tax, and legal professionals before making any decisions.
The Capital Gains Tax Landscape
Understanding your total tax burden is the first step. For high-earners, the federal long-term rate isn't the full story; it's a combination of multiple federal and state taxes that significantly impacts the net proceeds from any sale.
Long-Term Rates
0-20%
Federal rate based on income.
NIIT Surtax
3.8%
Additional federal tax for high-earners.
State & Local Tax
0-13.3%
Varies widely (e.g., CA at 13.3%).
True Blended Top Rate
~37.1%
Potential combined top rate in high-tax states.
Strategy Comparison Dashboard
Select a strategy from the dropdown to see its illustrative profile across five key metrics. This tool can help you understand the characteristics of each option and its potential trade-offs.
The Core Trade-Off: Benefit vs. Complexity
This chart visualizes strategies by their primary asset class. Notice how different types of strategies cluster in different areas of the chart, revealing inherent trade-offs for each category.
Deep Dive: Comparing Tax-Loss Harvesting Methods
"Tax-Loss Harvesting" isn't a single tactic; it's a spectrum of strategies with increasing power and complexity. This chart compares the most common methods, revealing the trade-offs between cost, complexity, and potential benefits.
The Advisor's Role: Quarterbacking Your Professional Team
Navigating these complex strategies requires a coordinated team of experts. As your fiduciary wealth advisor, our role is to act as your "quarterback," helping you understand the landscape and working closely with your tax and legal professionals to select and implement strategies that are truly suitable for your specific situation.
Wealth Advisor
Integrates tax strategies with your overall financial plan, investment goals, and risk tolerance.
CPA / Tax Professional
Provides tax advice, manages compliance, and prepares all necessary tax filings and forms.
Tax & Estate Attorney
Structures legal entities, drafts trust documents, and provides legal opinions on complex transactions.
Strategy Stacking Examples: Combining Techniques for Multiplied Effect
The most sophisticated tax planning involves "stacking" multiple strategies to achieve outcomes no single technique can. These are complex, illustrative examples that require extensive professional guidance.
The Real Estate to Retirement Stack
Sell rental via 1031 Exchange into a future primary residence.
Hold as rental, then convert to primary residence.
Sell home and use §121 Primary Residence Exclusion to eliminate up to $500k of gain, tax-free.
The Business Exit to Income Stack
Sell business via Deferred Sales Trust to defer the large gain.
Trustee invests proceeds in a diversified portfolio, including a TALS strategy.
TALS generates losses to offset taxable income from the Trust's installment note, creating a tax-efficient income stream.
Comparing Strategies
While every situation is unique, these charts compare the illustrative scoring for each strategy based on potential tax benefits and the typical liquidity of the capital after the strategy is implemented.